Britain is facing a 'tsunami' of house repossessions as soon as interest rates start to rise, one of the country's leading bankers has warned.

Richard Banks, the chief executive of UK Asset Resolution (UKAR), the body that runs the £80bn of mortgages bailed out by the taxpayer during the banking crisis, also said in an interview with the Guardian that the Labour government's pleas at the start of the crisis for lenders to keep families in their homes was forcing some homeowners further into debt.

In a warning that the industry may have been too lenient with some of its customers, he said he believed a policy of "tough love" would be fairer to people facing long-term difficulty in keeping up payments on loans taken out when house prices were at their peak and personal incomes on the rise.

His warning came the day after the international bank regulator said the Bank of England, which has kept rates at 0.5% for more than two years, would have to raise rates shortly to curb inflation.

The Bank of International Settlements said the policy of the Bank of England, whose rate-setting committee is split over whether or not to increase borrowing costs, was "unsustainable".

With 750,000 customers, UK Asset Resolution, set up to run the nationalised mortgages of Bradford & Bingley and parts of Northern Rock, is the country's fifth largest mortgage lender. But 23,000 of those mortgage holders are more than six months behind with payments and Banks admitted the projections for the number of people falling behind on payments could get "scary" if lenders did nothing to prepare for higher rates.

"You can see if you don't do something about it, you can see a tsunami," he said. "If you don't get into the hills you could get drowned by this. If you don't manage this properly it could get very messy."

He regards it is an industry-wide problem, albeit one that might be concentrated at UKAR as its customers include buy-to-let landlords and so-called self-certified borrowers – those without salaried income. UKAR, through three calls centres in Crossflatts, West Yorkshire, Gosforth, Newcastle, and Doxford, Sunderland, has begun cold-calling customers it believes are at risk of falling behind on payments in an attempt to keep their mortgage payments on schedule.

The bank is also trying to tackle customers behind with payments for six months or more and at risk of repossession.

His concern about a surge in repossessions is partly the result of moves by the industry early in the 2008 crisis to grant so-called forbearance to help customers stay in homes by, for example, reducing monthly interest payments. "We as an industry, as a kneejerk reaction in the emergence of the crisis, and because the government asked us to be forbearing to customers in the hope it would all go away, we have been too lenient with some customers.

"It's a tough love approach," he said. "It's treating customers fairly, not nicely, because if you can't afford your mortgage you are only increasing your indebtedness. If we allow you to increase your indebtedness, that's not really fair to you."

Forbearance has been brought into play in up to 12% of mortgages, the FPC said.

It also noted that the most "vulnerable" households were concentrated in a few banks. It did not scrutinise UKAR but noted that the two other bailed-out banks, Lloyds Banking Group and Royal Bank of Scotland, had the largest exposure to customers whose mortgages were bigger than their value of their homes.

Last month, the Financial Services Authorityissued a guide to handling forbearance in which it warned: "Arrears and forbearance support provided with due care by firms has a beneficial impact for both the firm and the customer … However, where such support is provided without due care or any knowledge or understanding of the impacts, it has potentially adverse implications for the customer, for the firm's understanding of the risks inherent within its lending book, and in turn for the regulators and the market."

House prices down in England and Wales

LONDON: House prices in England and Wales have edged lower this month to show their biggest annual fall since October 2009, a monthly survey from property data company Hometrack showed on Monday.Average house prices dropped by 0.1% in June, continuing a pattern of modest falls so far this year and taking the year-on-year decline to 3.9%.

Other house price surveys have shown similar price falls over the past 12 months. Prices dropped by around 20% during the financial crisis, but partly recovered in early 2010.Hometrack's director of research Richard Donnell said that the property market had been less weak so far this year than he had expected.

A general view of houses in Grange Villa, England. — AP

“Low transaction volumes, low mortgage rates and forbearance by lenders limiting the number of forced sales have all played their part. While average prices have slipped back by 1%, sales volumes have increased off the back of higher demand and greater realism over achievable prices,” he said.

House prices are under pressure from slow wage growth and lenders' preference for much higher mortgage deposits than before the financial crisis.

Hometrack's data is based on a monthly survey of estate agents and surveyors, asking for average achievable prices for different categories of property. - Reuters

Home Prices in 20 U.S. Cities Probably Declined in April From Year Earlier

By Shobhana Chandra

Home prices probably decreased in April, showing the housing market remains an obstacle for the U.S. recovery, economists said before a report today.

The S&P/Case-Shiller index of property values in 20 cities fell 4 percent from April 2010, the biggest year-over-year drop since November 2009, according to the median forecast of 30 economists surveyed by Bloomberg News. Other data may show consumer confidence held near a six-month low.

A backlog of foreclosures and falling sales indicate prices may decline further, discouraging builders from taking on new projects. The drop in property values and a jobless rate hovering around 9 percent are holding back consumer sentiment and spending, which accounts for 70 percent of the economy.

“Home prices remain incredibly bogged down by foreclosures and weak demand,” said Sean Incremona, a senior economist at 4Cast Inc. in New York. “The picture is unlikely to change much this year. Declining home prices and high unemployment are bad for confidence.”

The S&P/Case-Shiller index, based on a three-month average, is due at 9 a.m. New York time. Survey estimates ranged from declines of 4.9 percent to 3.5 percent. Values fell 3.6 percent in the 12 months to March.

The New York-based Conference Board’s consumer confidence gauge, due at 10 a.m., rose to 61 from 60.8 in May, according to the Bloomberg survey median. Estimates ranged from 55 to 66.7.

Fuel Costs

Some of the improvement probably reflects a drop in fuel costs. The average price of a gallon of regular gasoline fell to $3.57 on June 26, down from a May 4 price of $3.99 that was the highest in almost three years, according to AAA, the nation’s largest auto club.

The projected rise in confidence contrasts with other surveys in which Americans’ moods dimmed. The Bloomberg Consumer Comfort index dropped in the week ended June 19, the first decline in five weeks, and the Thomson Reuters/University of Michigan sentiment gauge fell more than forecast this month.

The Case-Shiller report may show home prices fell 0.2 percent in April from the prior month after adjusting for seasonal variations, the 10th straight decrease, according to the Bloomberg survey.

The year-over-year gauges provide better indications of trends in prices, the group has said. The panel includes Karl Case and Robert Shiller, the economists who created the index.

Shiller told a conference in New York this month that a further decline in property values of 10 percent to 25 percent in the next five years “wouldn’t surprise me at all.”

Fewer Sales

Reports earlier this month showed the housing market is yet to gain momentum. Sales of previously owned homes, which comprise about 94 percent of the market, were down 3.8 percent last month from April, the National Association of Realtors said.

Purchases of new houses dropped 2.1 percent in May, the first decline in three months, according to Commerce Department data. Competition from foreclosed homes is hurting demand for newly built dwellings.

The 1.8 million-unit inventory of distressed homes nationwide that may reach the market would take about three years to sell at the current pace, Daren Blomquist, communications manager at RealtyTrac Inc., said this month.

As house prices decline, owners feel less wealthy and home equity shrinks, making borrowing more difficult.

The Standard & Poor’s Supercomposite Homebuilding index lost 4.4 percent as of June 27 from the end of April, less than a 6.1 percent drop in the broader S&P 500 gauge, which was weighed down largely by concern about the European debt crisis.

Builder Outlook

Some developers expect demand to stabilize following a poor selling season. Lennar Corp. (LEN), the third-largest U.S. homebuilder by revenue, last week said second-quarter sales fell from a year earlier and home orders were little changed, while the average price climbed. The 2010 orders were boosted by a federal tax credit for homebuyers that required contracts be signed by April 30.

“While it’s now well documented that the expected spring selling season of 2011 simply did not materialize, it is beginning to feel like the worst days of the housing market are getting behind us,” Chief Executive Officer Stuart Miller said during a conference call with analysts on June 23.

Wednesday, 29 June 2011

Rosalind Corlin and her high-achieving kids, Estephe (left) and Perrine, back in Kuala Lumpur for a short break, showing off the kids’ book, 'The Roar Of The Tiger Cubs'.

By Dr GAN SIOWCK LEE

ESTEPHE and Perrine Corlin, twins aged 10, were in Kuala Lumpur recently to visit their mum’s family, and to promote their new book The Roar Of The Tiger Cubs to help raise funds for their favourite charity project. The children reside in Hong Kong with their Malaysian mother and French father.

Estephe and Perrine shot to fame when they sat the Cambridge University International General Certificate Secondary Exam (IGCSE) Mathematics for 16-year-olds last November, and scored As!

Since then, their mother Rosalind Wong-Corlin, 43, who hails from Kelantan but grew up in Kuala Lumpur, has been unofficially crowned the “Tiger Mother of Hong Kong”, coming hot on the paws of the original “tiger mum”, Amy Chua.

The Chinese American author and law professor’s gruelling and no-nonsense parenting approach extolled in her bestselling memoir Battle Hymn of the Tiger Mother, released this year, is alternately viewed as oppressive by Western parents and effective by their Chinese counterparts.

Now, everyone wants to know the Corlin children’s story and formula for success, too. Not only do the twins excel in their studies, they are also champions and medal winners in sports such as swimming and judo. In this respect the Corlin kids are very different from Chua’s two children, who are not encouraged to do well in sports.

Here’s a chat with Rosalind, who contributed to two of the 26 chapters in the book written by her twins, during her recent trip home:

Let’s start with a brief life history of the kids ….

When the kids were born in Switzerland, we hired a nanny for the first two years. Then we spent a year in Boston (United States) and then back to Switzerland for another year before going to Hong Kong when they were five years old, where we have lived since. As my husband (a top executive of a US-based medical technology firm) travels constantly on business and my job was equally demanding, I decided that it was time for me to stop work so that I could “watch” them grow and develop.

So, you gave up a promising career in finance and a big salary to adopt an active approach to parenting? What are some of your personal sacrifices, if any, in moulding your kids into what they are today?

To me parenting is a big responsibility that should not be delegated to someone else, not the grandparents, not a nanny, certainly not a maid! Financially, it was a more painful decision as we were down to a single-income family. I soon found out that my journey in motherhood was not so easy. My children were more than a handful. I found a Chinese nanny to help out, and to speak Mandarin with them. I thought it was essential they master one more language and speak Mandarin like a Chinese native speaker.

My challenges today are different; I have to keep them motivated to do their best. It’s tough and requires a lot of time and dedication.

You exposed them to another new language, i.e. Mandarin, at an early age.

That was a good decision because research findings have consistently indicated that bilingualism enhances and strengthens cognitive development in young children.

How did you come to recognise and develop the potential of your kids to achieve what they have managed so far?

Their kindergarten teachers had mentioned that Estephe exhibited an exceptional ability in maths. My father-in-law, a specialist in tuberculosis, who spent a lot of time playing mental and maths games with my children during the holidays, said the same thing. In Hong Kong I got to know Horatio Boedihardjo, the Hong Kong maths genius who went to Oxford at the age of 15. He was doing his PhD at 17 when we started exchanging e-mail.

I asked him if he would meet Estephe and Perrine and show them some maths. When Horatio came back to Hong Kong for the winter holidays in 2007, he spent some time with the kids. He brought me some maths books and quizzes for the kids, and since then I have personally tutored them in maths and science with the help of some university students.

You found them a role model, so to speak. But how did you stimulate/accelerate your kids’ all-round development in the cognitive and psychomotor domains when they were still toddlers?

Just a couple of examples: When we were in Boston we lived at the top of a hotel so the kids would dip in the pool every day. They had floaties but I would remove one individual square foam every week so that by the end of summer they could float by themselves in the water naturally. My father-in-law is an avid reader, he bought them many books which they enjoyed.

My husband and I would read to them every day when they were little, in both French and English. Now, reading is one of their favourite hobbies.

As they grow up and go to school, how do you ensure that they are NOT excluded from the normal socialisation process that takes place in schools? How do you encourage a healthy all-round development that also includes the social and affective domains?

Take swimming, for example. They have good friends in our swim club so this helps them endure the training sessions. They are popular with their peers and the kids in their school. When the National French TV M6 visited their school to film them in class, the crew interviewed their friends to ask if they were “normal” and the response was positive.

They also have many friends from the swim team, the judo club and rugby. I think sport is very important in ensuring a wellbalanced lifestyle and education for the children. It strengthens them emotionally and develops their character. In sport they belong to a team. They learn to respect one another, to have good sportsmanship, to value and build friendship, and to share. I think this is great.

I try to inculcate a positive attitude in their daily life in everything they do. There are times when they may not feel like going for swim training at 5.30am, or doing homework, but they know they have to get these things done. I instil in them the notion that life is a challenge and results or success

comes with some effort and self-discipline.

The same attitude has benefited them in their studies and helped them achieve the academic results they have today.

What else are you doing to structure a stimulating environment for them to develop in the cognitive domain?

I provide opportunities for them to master different languages. They go to the French School, currently in the bilingual section – 50% English and 50% French. They have Chinese tuition at home. The school caters for French nationals whose mother tongue is French. We will move them to the Island School in August, one of the English Foundation Schools in Hong Kong. For maths and science, they will be in higher level classes or given work at their level because they are ahead of their peers in these subjects. In Mandarin they will be in the class for native speakers.

It’s great that this school has this flexibility to cater for kids with different abilities in certain subject areas. This certainly is a way of putting Howard Gardner’s theory of multiple intelligences into practice! What about their moral and values education?

I try to inculcate good values by involving them in worthy causes. They now know they have a social responsibility. Writing the book has been a good start as this has allowed them to contribute the proceeds to a nonprofit organisation, “Bring Me A Book Hong Kong”, which promotes literacy in children (www.bringmeabook.org.hk).

It is widely acknowledged that human potential, some extraordinary, remains largely untapped in most people throughout life. As far as academic pursuit goes, what is your main focus?

When they were younger, the focus was on developing their minds, consistently encouraging them to ask questions both at home and in school. In the past year, they have matured a lot and acquired a lot of knowledge.

They can now combine both, applying the knowledge they have acquired in novel situations, to solve problems, synthesise new ideas ... they have shown this in their book.

This reminds me of what Confucius advocated, that learning and thinking must go hand in hand. “Learning without thinking leads to bewilderment; thinking without learning is futile.” One last question for the “tiger mum”: How would you describe your relationship with the kids?

I am strict with them, but there is a very warm and close bond between us. I organise both fun times and work times for them. Whatever I do they know that it is for their good. They know I sacrifice a lot of my time for them. For me the most important thing is that I will always have a close relationship with them. In my opinion, strengthening and sustaining this bond is the biggest challenge for parents as the kids grow up.

Twin power

I SHOWED up for my appointment with Estephe and Perrine Corlin at Kuala Lumpur’s Royal Lake Club swimming pool where they were training with their “tiger mother” Rosalind Wong-Corlin.

According to Rosalind, the kids were preparing for an open water meet in France in August, and their coach did not want them to miss three days of training even while holidaying in KL! So, Rosalind, herself a former Malaysian national swimmer, had to take over coaching duties here.

The children were in their swim gear, complete with caps and goggles. They were adorable and, yes, “normal”, coming across as perfectly well-adjusted, with a healthy tanned complexion and cheerful impish smiles.

Estephe is the older (by a few minutes) and more bubbly and chatty of the two, while Perrine is like a little lady, demure and sweet.

We started out talking about The Roar Of The Tiger Cubs, their new book that details their lives thus far and their drive for success.

First, tell us why you wrote the book.

Estephe: We want to share with the other kids that if you think you can, you will! Everything can be done if you put in your effort.

Perrine: Yes, I want to tell other kids that “the world is your oyster” ....

Estephe: In the book, we tell stories about our lives, precious moments that we will always remember ....

Perrine: ... and experiences which have helped us in growing up.

What’s the writing process like?

Estephe: We worked over three months, we used materials from our diaries, our collection of photos and drawings.

After these few initial questions which broke the ice, the kids opened up and there was no telling who was saying what ... each had so much to offer.

To sum it up, their outstanding achievements in both studies and sports notwithstanding, Estephe and Perrine are very much like other kids their age. They got very enthusiastic and excited once they started talking about their hobbies which include playing chess, skiing, watching DVDs and hiking with their parents, sailing with Dad. In short, just spending time and having fun with their folks.

Like kids their age, they use the computers and the Internet for their school work, but said they have no time for social media such as Facebook. Estephe loves playing rugby, and Perrine likes singing and is a fan of Lady Gaga.

Since the interview was conducted in English, I decided to test their Mandarin. I was impressed to find them speaking like mainland Chinese, and having already read quite a few Chinese classics.

They also offered to show me their Chinese names by writing them out.

Before we said goodbye, I gave them a little pocket book of Chinese proverbs and idioms illustrated with cartoons. They were quite thrilled as they are familiar with many of the phrases. At this young age they can already appreciate the legacy of this priceless language that is deeply rooted in history, culture and tradition.

* Dr Gan Siowck Lee is an education specialist and consultant, and former associate professor of Universiti Putra Malaysia. The Roa r Of The Tiger Cubs is available locally at all major bookstores.

Tuesday, 28 June 2011

Decolonization of universities begins with us

1 July 2011 By Zainon Ahmadnewsdesk@thesundaily.com

PETALING JAYA (June 30, 2011): They were knocked off their pedestals just as rudely as Saddam Hussein statues were pulled down from their mountings after the Americans and their mostly western allies overran Baghdad in 2003.

Among them are such gods of science and mathematics as Sir Isaac Newton, famous for his law on why apples fall.

He was pilloried for allowing his fear of the Church of England to deter him from publishing some of his best discoveries – his true masterpieces.

Others who were knocked down included people like Keppler, Descartes and Einstein. And so was Galileo who invented the telescope but was in trouble with the Catholic Church when he could see too far into the heavens.

All these bashings and the questioning of the assumptions on which human knowledge is based took place during the three-day International Conference on Decolonising Our Universities that ended on Wednesday in Penang.

It was the fourth in the series of Multiversity Conferences organised by Citizens International and Universiti Sains Malaysia.

Nicolaus Copernicus is remembered mostly as a mathematician and an astronomer but few know that he is also a monk and it was because of this that his claim that the earth moves around the sun and not the other way round as was originally believed was easily accepted by the church.

But the conference was told that he was not the revolutionary scientist he has been made out to be. He was a just a common plagiarist. He merely translated the work of Ibn Shatir of Damascus.

It was also told that few academics, scientists, mathematicians, astronomers and other researchers were really free of the influence of Christian theology because for centuries the church was the key consumer of the products of the western university system and therefore had to remain loyal.

The conference was told that anyone who challenged the church had to suffer and it was for that purpose that the Inquisition was instituted.

Rival institutions also suffered and this was the fate of the great university complex of Alexandria, of which the famous library was a part.

Many wondered aloud whether Christian theology still influences western academicians and brought up the brilliant Stephen Hawkings whom most Malaysians know only as the writer of a small book, A Brief History of Time.

Hawkins wrote many other books and some contain quite a bit of Christian propaganda. He even attempted to reconcile the Big Bang of a few billion years ago with the Bible story of creation in seven days some 6,000 years ago.

Many other gods of science and mathematics, as the world know of them, were also called liars. The great 16th century cartographer Gerardus Mercator whose maps and charts helped the Europeans to reach the East was so fearful of the church that he did not acknowledge his non-Christian and especially Muslim sources.

Another great god of science and mathematics, Albert Einstein, was dragged down from his Olympian heights when it was disclosed that his formula on the theory of relativity was corrected by Indian scientist and mathematician C. K. Raju recently.

The expose by the scholars and participants from 20 countries help to convince those who were still hesitant about the need for efforts to decolonise universities – still very much Eurocentric – in Asia and Africa that the knowledge they had been “brainwashed” into believing as being universal was not universal at all and based on false assumptions.

It was also meant to provoke re-thinking about the assumptions they had made based on discoveries and ideas of western scholars published in western academic journals, that nothing should be accepted as universal truth without careful scrutiny.

Students have often assumed calculus, the subject they learn in mathematics, is of western origin. Nothing is further from the truth. It was stolen from India by the Jesuits, said Raju who said the mode of calculation was important for navigational purposes.

It helped Vasco da Gama to reach the Cape of Good Hope and Goa.

According to Datuk Shad Saleem Faruqi, emeritus professor of law and legal adviser, Universiti Teknologi Mara, who is also visiting professor at Universiti Sains Malaysia, the Europeans think nothing of falsifying history.

He said everyone seems to think that the Johannes Gutenburg’s printing press, developed in the 15th century, was the first in the world when a number of western scholars were aware that Pi Sheng had already developed one in 1040 but little is said of him.

Likewise, the West seems reluctant to acknowledge scholars from India, China, Africa and those from the Muslim world and promotes the idea that the Bologna monastic school was the first university.

Thus, few know about the great universities of Taxila, Nalanda, Zaytuna and Nanjing which preceded Bologna.

On legal education, he said, it is still very much western-centric and lamented that despite the existence of local law programmes since 1972, the Legal Profession Act continues to recognise foreign (mostly UK) law degrees and qualifications.

On the Act’s permission to foreign lawyers to be admitted on an ad hoc basis to argue special cases, he was cynical to the idea of inviting Cherry Blair as a human rights expert when there are hundreds of local ones.

Fortunately, the judge was not an Uncle Tom and he rejected her application.

Because of this, the conference agreed that while the physical colonisation is long gone – hopefully so, said some – the mental colonisation is very much alive.

Thus the call for the need to purge the “West in us” before efforts to decolonise can truly begin.

He said many Western theories were being used to address local problems and this sometimes made things worse as the theories were not designed to suit the local context.

Decolonising our universities

COMMENT By PROF SHAD SALEEM FARUQI

Western chemistry had its predecessor in Eastern alchemy, Algebra had African roots, and Arabic was at one time the lingua franca of science and technology.

AN ongoing international conference in Penang is examining the issue of intellectual enslavement in Asian and African citadels of learning. Luminary after luminary are pointing out that education in Asia and Africa is too West-centric. It blindly apes Western universities and Western curricula.

Our university courses reflect the false belief that Western knowledge is the sum total of all human knowledge.

The books prescribed and the icons and godfathers of knowledge are overwhelmingly from the North Atlantic countries.

Titles written by scholars and thinkers from Asia and Africa are rarely included in the book list. Our curricula exhibit lack of awareness of the Asian and African contributions to civilisation.

Any evaluation of right and wrong, of justice and fairness, of poverty and development and of what is wholesome and worthy of celebration tends to be based on Western perceptions.

Eastern ideas and institutions are viewed through Western prisms and invariably regarded as primitive and in need of change.

The imperatives of globalisation have further tilted the balance in favour of the Anglo-American world view.

Encapsulation: It was my privilege to point out that all human beings are encapsulated by time and space. We are all susceptible to narrow religious, racial and communal perspectives.

Our whole life is a process of expan-ding the horizons of thought and adding to the islands of k

On the same score, North American and European world-views are also limited by their own social experience.

However, due to their colonial ascendency (which has not abated and has simply taken on new forms) and due to their military and economic might, their perspectives pass off as universal, transcendental and absolute.

Politically free, mentally enslaved: For instance, legal education in this country is primarily British based.

It is profession-oriented not people-oriented. Despite the Asian context, it does not emphasise need-based programmes.

It does not highlight the burning issues of the times the plight of the marginalised and the downtrodden and issues of corruption and abuse of power.

Students are not trained or encouraged to walk in the valleys where the rays of justice do not penetrate.

The syllabi are fashioned on British LLB and Bar at Law courses. Education is textbook based rather than experience based. The structure of the course, the topics covered, the books prescribed, the icons of knowledge are mostly from outside Asia.

The expatriate lecturers and external examiners are mostly from the North Atlantic countries. Asian books, Asian theories and Asian scholars are generally not regarded as fit for such recognition.

This is despite historical evidence that Chinese, Indian and Persian universities predated universities in Europe and provided paradigms for early Western education. Cultural and scientific renaissance flourished in the East long before the European renaissance.

Everyone knows about the Gutenberg printing press. Very few know that Pi Sheng developed one in 1040. In science, Galileo, Newton and Einstein illuminated the firmament but not much is known about Al-hazen and Nasir al-Din al-Tusi.

Western chemistry had its predecessor in Eastern alchemy. Algebra had African roots.

Durkheim's and Weber's sociology must compete with Ibn Khaldun and Jalal Al-Din Rumi. Freudian psychology had its corrective in Buddhist wisdom. The Cartesian medical model has its Eastern counterpart in ayurvedic, unani and herbal methods.

Very few are aware that Arab Muslims were central to the making of medieval Europe. From the 8th to the 13th centuries, Arab and Islamic cultures were at their zenith and were renowned for their science and learning. Aspiring scholars from all over the world flocked to these citadels of education.

Arabic was at one time the lingua franca of science and technology. A large number of texts written in Arabic were translated into Latin without acknowledgment.

Plan of action: So what should be done? It should not be part of our agenda to try to ask European and American universities to include the treasures of the East in their syllabi. Whether their worldview should be enriched by the insights and reflections of the East that is their problem.

Our concern is that our own universities should first of all shed the slavish mentality of blindly aping Western paradigms.

Secondly, we must embark on a voyage of discovery of our ancestors' intellectual wanderings. We must seek to rediscover the intellectual wonders and heritage of China, India, Persia, Mesopotamia, and other Eastern and African civilisations.

Our aim should never be to shut out the West or be insular. Let the wearing of blinds be the speciality of someone else. Our aim should be to be truly global, to give our students a bigger picture of knowledge and to increase their choices.

In the background of pervasive Western intellectual domination, indigenisation would assist a genuine globalisation.

Also, this discovery of our treasures should not be as an exercise in flag-waving nationalism. Its aim is ameliorative.

Diversity and pluralism of knowledge systems is vital for meeting many of the moral, social and economic challenges of the times.

For example, Asia should offer a critique of the ethnocentrism of Western scholarship by pointing out that a middle class Western lifestyle and what that entails in terms of the nuclear family, the consumer society, living in suburbia and extensive private space may neither be workable nor desirable in the modern world.

Growth for the sake of growth is the ideology of the cancer cell and some brakes on “development” policies and some reconsideration of what amounts to the good life is in order.

Humanity is living on the verge of a precipice, afraid both to climb and to fall. But the ground is slipping beneath us. It is time for a dialogue between civilisations, a mutual process of learning from each other and a building of a garland of wisdom with blossoms from many Eastern and Western gardens.

Shad Saleem Faruqi is Emeritus Professor of Law at UiTM and Visiting Professor at USM.

Peter Steiner’s now famous cartoon for the New Yorker, “On the Internet, nobody knows you’re a dog,” first appeared in 1993 but didn’t, according to the artist, receive much attention until the Internet became more familiar to people. It was a rare instance of a cartoon doing what it’s not supposed to do, gaining relevance over time as people understand just how pithily it captured an essential truth. This, surely, elevates it to one of the most important cartoons in history (Steiner told the New York Times in 2000 that he felt a little like the person who invented the smiley face).

History has shown Steiner’s vision to be much too benign, and the cyber events of the past year — hacking and theft on the scale of 18th-century piracy — demand an update, perhaps along the lines of, “On the Internet, no one knows you’re China.” But even that may have been spoiled after the events of this week, which saw the appearance of an alliance between two groups of clandestine hackers, Anonymous and LulzSec, both of which have been implicated in numerous high profile security breaches.

In a statement announcing “Operation Anti-Security,” LulzSec declared that “the government and white hat security terrorists across the world continue to dominate and control our Internet ocean … we encourage any vessel, large or small, to open fire on any government or agency that crosses their path.”

This was accompanied by “an open letter to citizens of the United States of America” on Anonymous’ news site, which sounded uncannily tea party-ish in its call on Americans to “wake up” and take back their liberties from a corrupt government.

To judge from the reaction of some information security experts, the alliance was on the scale of Germany teaming up with Japan during World War II. Except by the end of the week, LulzSec was apparently calling it quits, alarmed, perhaps, by the arrest of an alleged member in Britain and the attempts by other hackers to expose their identities.

With subterfuge as the name of the info-war game, the virtual equivalent of smoke and mirrors makes it difficult to say what’s true and what might be misdirection, especially with organizations that are leaderless and decentralized. But here’s the upshot of this recent cycle of cyber shenanigans: On the Internet, one person’s freedom fighter is another’s terrorist.

Technological prowess has given hackers an extraordinary sense of political entitlement. It’s easy to theorize about how the world should work if your only engagement with it is through a computer and you’re in your teens or 20s. But weaponize your theories through hacking and you’re all but certain to lose the public, who will demand ever more stringent crackdowns and restrictive laws that, in turn, will push some hackers to even more extreme responses.

At the same time, the hacker collectives do possess a technological prowess that is beyond the imagining of most people, and with a deep understanding of how technology works, there is the privilege of insight. The explosive development of the Web raises serious, complex questions about ownership, privacy and freedom. And if these are ignored by politicians, or dominated by commercial interests, or dismissed by a mainstream media averse to complexity, then hacker frustrations will turn to direct action as a way of getting attention.

This is, after all, what non-governmental organizations and other advocacy groups do on a much more limited scale to promote their interests. (Still, it’s one thing to disrupt traffic with a protest march; it’s another to disrupt Internet traffic with a denial-of-service attack.)

The question is what kind of politics is this technology empowering? If you don’t acknowledge genuine concerns or even good faith in the info security community, if government is irredeemably corrupt, then you haven’t just abandoned politics, you’re anti-political; all that’s left is a war of attrition.

Oddly, the most useful insights on hacker culture may come from a re-engagement with the politics of anarchism, as noted in a review of new books on the subject in the summer issue of BookForum by Columbia historian Mark Mazower. While Mazower makes a mistake, in my view, in seeing revolutionary politics as still being mediated through academic leftism rather than through technology, his point — that the anarchist theories of the 19th century are more relevant than Marx to explain the present political conditions — is timely.

“Anarchism’s combination of individual commitment, ethical universalism and deep suspicion of the state as a political actor mark it out as the ideology of our times,” writes Mazower, before ending his piece with the claim that “we are all anarchists now.”

But we’re not. We are disenfranchised because today’s anarchism belongs to the hackers — and they have the means to make much better bombs. Whether the alliance between LulzSec and Anonymous was ever real or not, it defines the new ideological reality of our times: the network as an emerging anarchic state actor. Whether we like it or not, this politics of technology forces us toward libertarianism, to maximal freedom, because the alternatives — anarchy and control — are dancing toward disaster.

“We would be in the land of the unpredictable” if lawmakers fail to reach an agreement to raise the $14.3 trillion debt ceiling and the U.S. misses a payment “simply because of the technical linkages,” El-Erian said in an interview on CNN’s “Fareed Zakaria GPS” program, scheduled to air today.

U.S. lawmakers are seeking a path to increasing the debt limit and to cutting at least $1 trillion from the long-term deficit before an Aug. 2 deadline. President Barack Obama plans to hold separate meetings at the White House June 27 with Senate leaders Nevada Democrat Harry Reid and Kentucky Republican Mitch McConnell in an effort to break an impasse that scuttled a seven-week negotiating effort led by Vice President Joe Biden.

“My advice is please try and get together and solve this issue in the context of a medium-term reform package,” El-Erian said.

“If you can’t do that and you’re going to kick the can down the road, kick the can rather than face something that could be catastrophic in terms of legal contracts being triggered.”

“A basic rule as an investor is don’t buy something unless you know who else is going to be buying,” he said. “So when we look at Treasuries, we see the big buyer stepping away from the market, for certain. And we ask the question, who else is going to be buying at these levels, and we can’t identify another buyer of the size of the Fed.”

El-Erian said the U.S. fiscal problems are dwarfed by those of Greece, whose debt reached 143 percent of gross domestic product last year.

“It is inevitable that Greece would have to restructure its debt,” he said. “Greece has two problems: it has too much debt and it cannot grow. And until these problems are solved, more and more of Europe is going to become contaminated.”

Europe has been treating Greece “not as a solvency issue, but as a liquidity problem,” El-Erian said. “We had a massive bailout a year ago in Greece, massive. A year later, every single indicator in Greece is worse off.”

Sunday, 26 June 2011

Contradictheory By Dzof Azmi

TECHNOLOGY is about making things easy. You want to send a message, click – that’s it. You want to download a song, click, click, click. A bit more difficult, but that’s it. You want to attack a website – well, that’s several clicks away, too.

In fact, attacking a website is now as easy as downloading a script and clicking on it. During the recent cyber attacks on 51 Malaysian Government websites, it was suggested that most of them were victims of such “script kiddies”.

The raids on the government websites were said to be in response to the blocking of 10 file-sharing sites on the Internet. The Malaysian Communications and Multimedia Commission (MCMC), which blocked the websites, alleged that it did so because the websites were violating the Copyright Act. They made available content which had been copied without permission, for download for free.

I have written on the subject of downloading content for free from the Internet before. My conclusion then was that if it’s Malaysian entertainment content, it is good if more people can access it as easily as possible.

Admittedly, if you have to do so by breaking the law, that is another thing altogether.

Yet, I believe the steps taken by the MCMC in response to pleas by copyright content owners is a misstep. If you are trying to prevent piracy, trying to block the hosepipe that is the Internet drop by drop is not likely to succeed.

It’s a problem of supply and demand. For music, movies and TV shows, the demand for cheap or free access is high. As a result people will resort to many difficult things, including paying RM150 a month for Internet access and learning how to download content for free. Well, as I said, the Internet makes the difficult easy.

The reasoning behind blocking the websites is that it will stem supply. However, because the Internet is intrinsically designed to provide access that’s as easy and reliable as possible to content that resides on it, blocking one website will only lead people to look for another. And blocking 10 will result in 10 others taking their place.

Even if you could block all the websites, the open nature of the Net will most probably result in alternative routes. There was a time when file-sharing programmes such as Kazaa and Napster ruled the wires. When they were unceremoniously blocked and banned, people just moved on to alternatives.

The problem is that the demand is too high. So, instead of restricting supply, perhaps we should just admit the real solution lies in satisfying demand.

Although it’s a rather simplistic way of looking at the problem, this paradigm shift has proven to succeed in another, seemingly unrelated field – the war on drugs.

In the late 1980s, Switzerland’s problem with drugs was similar to that in many other countries in the world. The problem extended beyond the existence of addicts; it brought with it additional crime, be it in the form of drug pushers who looked to sell their goods illegally, or users who burgled to pay for their addiction.

This prompted the Swiss Government to embark on an aggressive programme against drugs. But instead of just trying to lock up more drug dealers, they also looked at the users. In particular, they realised that not all addicts responded well to treatment, and that their demand for “hard” drugs would remain.

So, the Swiss did the next best thing – they tried to reduce demand of illegal drugs by prescribing heroin.

In 1994, the Medical Prescription of Narcotics Programme set up clinics around Switzerland and identified hard-core users, who were then given injections of pharmaceutical-quality heroin daily, combined with medical, psychiatric, and social monitoring.

For this, the addicts paid 15 Swiss Francs or approximately US$8.50 (RM26.30) per day.

After three years, not only were participants’ health more stable, the use of illicit heroin and cocaine had dropped. And, they were more likely to have a home and get a job. Income from illegal activities dropped from 69% to 10%, and the number of offenders and offences decreased by about 60% in the first six months of treatment.

A 2004 World Health Organisation report concluded that for every dollar invested in the programme, US$12 (RM36) was saved on law enforcement, judicial and health costs. The programme is recognised to be so successful that in a 2008 referendum more than 68% of Swiss voters chose to keep it.

How does this work for illegal downloads? I’m not suggesting we have free cinemas for hard-core download addicts, but I believe that if you make it easier and cheaper to access legitimate content, it will reduce the number of illegal downloads. In short, satisfy the demand and people will not abuse the supply.

Right now, Malaysian-made movies are available almost on-demand via products like Astro First and HyppTV. For only RM15 you can watch a movie that has premiered relatively recently.

It’s a low price, but still not low enough to deter piracy. The good news is that I think the price can go down further.

In the United States, a company called Netflix allows people to view all the movies they like, whenever they want, at US$7.99 (RM24) a month. Not only is their selection wider than what our local providers are offering, the cost also works out to be lower in the long run if you are a serious movie addict.

At the end of the day, technology is just a tool that can work both ways. Instead of just using it to make it hard for lawbreakers to commit crimes, shouldn’t we also make it easy for law-abiders to get what they want?

Logic is the antithesis of emotion but mathematician-turned-scriptwriter Dzof Azmi’s theory is that people need both to make sense of life’s vagaries and contradictions.

ANALYSIS By BARADAN KUPPUSAMY

Despite expert evidence that Datuk Seri Anwar Ibrahim is the man in the controversial video screened by the Datuk T trio, the Opposition Leader shows no resolve to step down and maintains he is not the person in the film.

They pleaded guilty to screening the video to selected journalists and editors at the Carcosa Sri Negara on March 21 and were each fined between RM1,000 and RM3,000.

But for Anwar, it is the start of another nightmare as he fights off this latest sex scandal which implicates him with a woman who is probably a Chinese sex worker at an Ampang apartment in February.

Sex scandals implicating Anwar have become all too familiar in recent years and denials and allegations of conspiracy by him and those around the Opposition Leader are equally familiar.

But while enumerating the facts of the case at the proceedings on Friday, deputy public prosecutor Kamaludin Md Said and defence lawyer for Rahim, Datuk Seri Muhammad Shafee Abdullah, quoted evidence from a report by experts that makes it difficult for a quick denial acceptable to the people.

Then, there is the playing of the recording in court, which makes the video a public document and therefore, freely available to the public from now.

The question raised by DAP adviser Lim Kit Siang on the veracity of the experts was also unchallenged in court.

Hany Farid is accepted as the “father of digital image forensic/video analysis” and his testimony cannot be easily questioned.He is frequently consulted for his opinions by newspapers, journals and courts. In 2009, he did an analysis of a famous photograph of Lee Harvey Oswald, the man who shot US president John Kennedy, holding a rifle and a newspaper and concluded the image was genuine.

In addition, he and Torresani are from Dartmouth College, one of nine Ivy League institutions in the United States founded in 1769 (before the birth of America in 1776), which employ the highest standards of learning and teaching in the world.

The police did a thorough job of getting a premier college in the United States to check on the authenticity of the video clip.

It is amazing that they (the police) could get the two professors involved to analyse the video. Their (the experts') involvement and that of Dartmouth College is why the case has been delayed this long.

But back to the question, is this end of the road for Anwar? Can he overcome this accusation?

Already some independent MPs, those who once backed Anwar, are demanding he resigns as MP.

They cited examples of MPs who had resigned in Turkey, Indonesia and the United States in recent weeks in the wake of sex scandals or sexual impropriety.

Anwar shows no resolve to step down. Instead, he is in fighting mode and rejects all calls for him to call it a day.

He also maintains he is not the man in the video. “We will deal with it. We will have to prepare our defence,” Anwar said to the possibility of being charged with making a false police report.

With mounting evidence of his sexual escapades and with the men close to him scraping the bottom of the barrel to find ways to support their leader, Anwar is still throwing at his enemies the same old charges to fend off their (the opponents') attacks.

“This is something they have to judge for themselves. The most important thing is to determine the authenticity (of the tape) and find the truth,” he said.

“Two foreign experts have verified the video clip as authentic,” he said.

Considering that Anwar has denied he is the man in the video against mounting US evidence that the probability of him is 99.99% and considering that his Pakatan Rakyat colleagues are in deep denial, it is left for Parliament to censure its leader of the opposition.

Anwar should do the honourable thing and resign from office

THE STAR SAYS

MULTIPLE expert analyses have now identified Datuk Seri Anwar Ibrahim as the man in the sex video.But his unlikely resignation from public office will remain unlikely, since public interest here is easily shunted aside.

Earlier, a local video professional and a Korean expert had also pronounced the video as genuine and undoctored.

Now Prof Hany Farid and Asst Prof Lorenzo Torresani of Dartmouth College in New Hampshire concur with those findings. Dartmouth is a top-notch Ivy League institution and among the most distinguished educational establishments in the world.

Prof Farid himself, a leading researcher and chair of Dartmouth's Neukom Institute for Computational Science, had even developed some of the latest techniques of video analysis.

All the available evidence and all the best forensic science now point overwhelmingly to Anwar.

Farid and Torresani's findings are said to be of “99.99%” certainty because to be 100% certain, a witness would have to be in the room at the time. That person is Datuk Shazryl Eskay Abdullah, who never had any doubts who was with him in the room.

But none of this will suffice for those who would insist on argument by denial.

A familiar combination of denial, spin and protestation would junk key witness testimony and top forensic analyses.

Reasonable people now know the truth, however much those with desperate political ambitions may deny and distort it.

PKR's partners in DAP and PAS must also know what they are unable to bring themselves to acknowledge publicly.

Adultery or even patronising a prostitute may not seem such a great crime. However, the stakes multiply for a Muslim leader, particularly one with an Islamist background who is aiming for the highest public office in the land.

PAS had earlier said it might have to review its Pakatan partnership with PKR if Anwar is the man in the video. Since there is no longer any reasonable doubt that he is, PAS now has to do the honourable thing as a reputedly forthright party with vaunted moral values.

But if nothing changes within PKR or Pakatan, that should also be no surprise.

In politics, doing what is honourable can often be difficult, especially for those who like to accuse their opponents of all kinds of intrigue and plots.

Saturday, 25 June 2011

BRUSSELS – For months now, a fight over sovereign-debt restructuring has been raging between those who insist that Greece must continue to honor its signature and those for whom the country’s debt should be partly canceled.

As is often the case in Europe, the crossfire of contradictory official and non-official statements has been throwing markets into turmoil. Confusion abounds; clarity is needed.

The first question is whether Greece is still solvent. This is harder to judge than is the solvency of a firm, because a sovereign state possesses the power to tax. In theory, all that is needed in order to get out of debt is to increase taxes and cut spending.

But the power to tax is not limitless. A government determined to honor its debts at any cost often ends up imposing a tax burden that is disproportionate to the level of services that it supplies; at a certain point, this discrepancy becomes socially and politically unsustainable.

Even if the Greek government were to succeed shortly in stabilizing its debt ratio (soon to reach 150% of GDP), it would be at too high a level to convince creditors to continue lending. Greece will need to reduce its debt ratio considerably before it can return to the capital markets, which implies – even under an optimistic scenario – creating a primary surplus in excess of eight percentage points of GDP. Among advanced-country governments, none (except oil-rich Norway) has managed to achieve a durable primary budget surplus (revenue less non-interest expenditure) exceeding 6% of GDP.

This is too much for a democratic country, especially one where the tax burden is very unequally shared. Greece is, in fact, insolvent.

The second question is how serious a problem it is not to repay one’s debts.

One camp notes that, for decades, no advanced country has dared to do this, and that is why these countries still enjoy a positive reputation. If just one member of the eurozone embarked on the debt-default path, all the rest would immediately come under suspicion. In any case, according to this view, contracts simply must be respected, whatever the cost.

On the other side are those who call for the creditors who triggered the excessive debt to be punished for their imprudence. Lenders must suffer losses, so that they price sovereign risk more accurately in the future and make reckless governments pay higher interest rates.

Both lines of argument are valid, but the fact is that countries that have restructured their debt have not found themselves worse off as a result.

On the contrary, far from being banished from bond markets, they have generally bounced back quickly: investors like a sinner who returns to solvency better than a paragon of virtue on the verge of suffocation.

Twenty years ago, Poland negotiated a reduction in its debt and came off better than Hungary, which was keen to protect its reputation. Debt reduction is not fatal.

The third question is whether a Greek default would be a financial catastrophe – and when it should take place. Two channels are at work, one internal and one external.

First, government bonds are the reference asset for banks and insurers, because they are easily tradable and ensure liquidity. Obviously, any doubt about the value of such bonds could cause turmoil. The Greek banking system’s solvency and access to refinancing would be hit severely.

Externally, in turn, other European banks would be affected. But more importantly, other debt-distressed countries – at least Ireland, Portugal, and Spain – would be vulnerable to financial contagion.

So this is a dire situation. But it does not explain the European Central Bank’s attitude. The central bank has motives to be concerned. But instead of trying to find a way to cushion the possible impact of such a shock, the ECB is rejecting out of hand any sort of restructuring.

Indeed, it is raising the specter of a chain reaction by invoking the collapse of Lehman Brothers in September 2008, and threatening to punish any restructuring by cutting banks’ access to liquidity.

But if Greece is not solvent, either the EU must assume its debts or the risk will hang over it like a sword of Damocles. By refusing a planned and orderly restructuring, the eurozone is exposing itself to the risk of a messy default.

Europe, however, is not obliged to choose between catastrophe and mutualization of debt. The best route – admittedly a narrow road – is initially to beef up the financing program for Greece, which cannot finance itself on the market, while at the same time ensuring through moral suasion that private creditors do not withdraw too easily.

This is what is being attempted at the moment. But this breathing space must be used for more than simply buying time.